Research on an Australian case (not more than 10 years old since the decision by the Court)...

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Research on an Australian case (not more than 10 years old since the decision by the Court) involving breach of company director’s/officer’s duties. Write a report outlining the following: 1. Case introduction. 2. Outline the duties/responsibilities (eg CA s. 181) breached and explain why the duties were breached. 3. Discuss and critically ANALYSE the court/tribunal decision and the reason for the decision in view of the Corporations Act. 4. Present the report in class or video recording. Your lecturer will advise which is appropriate. All members must present on the day or a fail will be recorded. Presentations will be of a maximum of 5 minutes.
	
Document Preview: HA3021 CORPORATIONS LAW 
 
T1 2017  
GROUP ASSIGNMENT

Due date: Weeks 6 to 12 
Maximum marks: 20 (20%) 
 
Instructions:   
This assignment is to be submitted by the due date in both soft-copy 
(Safeassign – Bb) and hard copy. 
 
The assignment is to be submitted in accordance with assessment 
policy stated in the Subject Outline and Student Handbook. 
 
It is the responsibility of the student submitting the work to ensure 
that the work is in fact his/her own work. Ensure that when 
incorporating the works of others into your submission that it 
appropriately acknowledged. 
 
Group assignment – students are to group themselves to a minimum of 
3 and a maximum of 5 students per groupResearch on an Australian case (not more than 10 years old since the decision by the 
Court) involving breach of company director’s/officer’s duties.  
 
Write a report outlining the following: 
1. Case introduction. 
2. Outline the duties/responsibilities (eg CA s. 181) breached and explain why 
the duties were breached. 
3. Discuss and critically ANALYSE the court/tribunal decision and the reason 
for the decision in view of the Corporations Act. 
4. Present the report in class or video recording. Your lecturer will advise which 
is appropriate. All members must present on the day or a fail will be 
recorded. Presentations will be of a maximum of 5 minutes. 
 
Maximum word limit – 2,000 words

PLEASE NOTE: 
 
• Submit group assignment on-line (must do Safe Assign Check). Only one 
group member. 
 
• Please fill in and submit to your lecturer the Corporate Law Rubric Report 
in class by Week 5 the latest. 
 
• Each team member also must also submit a Law Peer Evaluation with their 
presentation/video 
 
• NO SAFE ASSIGN WORK WILL NOT BE CORRECTED AND THE 
GROUP WILL HAVE A MARK OF 0 (ZERO).   
 
• GROUPS OF LESS THAN 3 AND MORE THAN 5 PEOPLE WILL 
RECEIVE A PENALTY OF 10 POINTS. 
 
• Proper referencing in accordance with school regulations

David · Accepted Answer

Introduction: 
The case, which I have chosen is related to “Storm Financial Limited” that is a financial service 
provider. The case is formally known as “Australian Securities and Investment Commission (ASIC) v 
Cassimatis (No. 8) [2016] FCA 1023” wherein the Federal Court of Australia inspected the nature of 
duties of director s of the company that was related to care and diligence owed by them under section 
180(1) of the Corporations Act 2001(Cth) (Corporations Act). In the trail, the Federal Court of Australia 
found that the directors of the company being a financial service provider had not perform their duties 
diligently which had resulted in a breach of duties from their end as it was evident during the trial that 
the directors were not vigilant enough to spot out the possibility of their company to contravene the 
Corporations Act. As the Court stated that a reasonable director must be aware of any such possibility 
in his/her company’s current circumstances. The directors of “Storm Financial Limited” clearly failed 
on this front that resulted in catastrophic consequences for the company.
Background: 
On 23 May 1994, Emmanuel Cassimatis and his wife Julie Cassimatis found a financial advice 
company initially with the name Cassimatis Securities Pty Ltd that was based in Townsville, 
Queensland, Australia. The company was later named as “Storm Financial Limited” and it was an 
Australian financial services licence holder (AFSL). The financial services provided by the company 
was based on a very unique model popularly known as “Double Gearing” or “Storm Model” that was 
developed by Emmanuel Cassimatis, one of the two directors. In the model, the clients could obtain a 
margin loan to invest in index funds and establish a cash reserve. The loan was borrowed against the 
equity in the home, clients had ownership of. Any client who had the capacity to borrow funds could 
avail the facility provided by the model. This model actually helped many of the clients to survive 
during the “Global Financial Crisis”. However, this model exposed the company towards a very high 
risk of default from its clients.  
ASIC felt that the directors of the company breached their duties in regards to section 180(1) of the 
Corporation Act. This led ASIC to commence proceedings against Emmanuel Cassimatis and his wife 
Julie Cassimatis for alleged breaches of their duties related to care and diligence as a director of the 
company in a circumstances where the company was solvent. Since Emmanuel Cassimatis and Julie 
Cassimatis were the only directors and shareholders of the company, it was clearly identified that 
Storm Financial Limited was managed in accordance with the informed wishes of the shareholders, 
who were Mr.& Mrs. Cassimatis themselves. 
The allegation put forth by ASIC stated that the model was not suitable for all kind of clients, the 
company had and the company didn’t differentiate them. There were many investors,

Research on an Australian case (not more than 10 years old since the decision by the Court) involving breach of company director’s/officer’s duties. Write a report outlining the following: 1. Case...

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